Company Registration No. 05241591 (England and Wales)
ELBIT SYSTEMS UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
ELBIT SYSTEMS UK LIMITED
COMPANY INFORMATION
Directors
Mr J Gaspar
Mr B Machlis
Mr M C S J Fausset
Mr D A Hook CBE
Mr R R Goldsmid
Company number
05241591
Registered office
2 Temple Back East
Temple Quay
Bristol
BS1 6EG
Auditor
Edwards
34 High Street
Aldridge
Walsall
West Midlands
WS9 8LZ
ELBIT SYSTEMS UK LIMITED
CONTENTS
Page
Directors' report
1
Directors' responsibilities statement
2
Independent auditor's report
3 - 5
Statement of income and retained earnings
6
Statement of financial position
7
Notes to the financial statements
8 - 18
ELBIT SYSTEMS UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2020
- 1 -
The directors present their annual report and financial statements for the year ended 31 December 2020.
Principal activities
The principal activity of the company continued to be that of an intermediate parent undertaking.
Results and dividends
The results for the year are set out on page 6.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr J Gaspar
Mr B Machlis
Mr M C S J Fausset
Mr D A Hook CBE
Mr R R Goldsmid
Auditor
The auditor, Edwards, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Energy and carbon report
As the company has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Other matters
On 11 March 2020, the World Health Organisation officially declared COVID-19, the disease caused by novel coronavirus, a pandemic. Management is closely monitoring the evolution of this pandemic, including how it may affect the company, the economy and the general population. We have an appropriate response plan in place, and we will continue to monitor and assess the ongoing development and respond accordingly.
On behalf of the board
Mr R R Goldsmid
Director
30 September 2021
ELBIT SYSTEMS UK LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2020
- 2 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
-
select suitable accounting policies and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
-
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
ELBIT SYSTEMS UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ELBIT SYSTEMS UK LIMITED
- 3 -
Opinion
We have audited the financial statements of Elbit Systems UK Limited (the 'company') for the year ended 31 December 2020 which comprise the statement of income and retained earnings, the statement of financial position and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
-
give a true and fair view of the state of the company's affairs as at 31 December 2020 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the
Auditor's
responsibilities for the audit of the financial statements
section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard
, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the directors' r
eport for the financial year for which the financial statements are prepared is consistent with the financial statements
; and
-
the directors' report has been prepared in accordance with applicable legal requirements.
ELBIT SYSTEMS UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELBIT SYSTEMS UK LIMITED
- 4 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of directors' remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit; or
-
the company is not entitled to claim exemption in preparing a strategic report due to it being a member of an ineligible group.
Responsibilities of directors
As explained more fully in the directors'
r
esponsibilities
s
tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company
'
s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below
.
We obtained an understanding of the legal and regulatory frameworks within which the Company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006, Taxation legislation
and
Health & Safety compliance.
We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be in the following areas: timing of recognition of income, the override of controls by management, inappropriate treatment of non-routine transactions and areas of estimation uncertainty. Our audit procedures to respond to these risks included enquiries of management about their own identification and assessment of the risks of irregularities, review and discussion of non-routine transactions, sample testing on the posting of journals and income transactions and review of accounting estimates for biases
.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
ELBIT SYSTEMS UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELBIT SYSTEMS UK LIMITED
- 5 -
These inherent limitations are particularly significant in the case of misstatement resulting from fraud as this may involve sophisticated schemes designed to avoid detection, including deliberate failure to record transactions, collusion or the provision of intentional misrepresentations
.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
Paul Tonks BSc (Econ) FCA (Senior Statutory Auditor)
For and on behalf of Edwards
30 September 2021
Chartered Accountants
Statutory Auditor
34 High Street
Aldridge
Walsall
West Midlands
WS9 8LZ
ELBIT SYSTEMS UK LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2020
- 6 -
2020
2019
Notes
£
£
Turnover
8,122,727
5,383,356
Cost of sales
(8,081,604)
(5,383,356)
Gross profit
41,123
Administrative expenses
(473,440)
(317,163)
Operating loss
3
(432,317)
(317,163)
Interest receivable and similar income
5
7,356,831
10,176,505
Interest payable to group undertakings
6
(44,250)
(58,303)
Profit before taxation
6,880,264
9,801,039
Tax on profit
7
(219,912)
(230,472)
Profit for the financial year
6,660,352
9,570,567
Retained earnings brought forward
33,415,685
35,345,118
Dividends
8
(11,500,000)
Retained earnings carried forward
40,076,037
33,415,685
The statement of income and retained earnings has been prepared on the basis that all operations are continuing operations.
ELBIT SYSTEMS UK LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2020
31 December 2020
- 7 -
2020
2019
Notes
£
£
£
£
Fixed assets
Tangible assets
9
1,438,326
1,328,037
Investments
10
17,381,562
17,381,562
18,819,888
18,709,599
Current assets
Stocks
13
248,330
246,538
Debtors falling due after more than one year
14
8,936,195
11,426,822
Debtors falling due within one year
14
20,592,133
6,503,656
Cash at bank and in hand
1,464,867
3,405,300
31,241,525
21,582,316
Creditors: amounts falling due within one year
15
(9,901,375)
(6,806,104)
Net current assets
21,340,150
14,776,212
Total assets less current liabilities
40,160,038
33,485,811
Provisions for liabilities
Deferred tax liability
16
84,000
70,125
(84,000)
(70,125)
Net assets
40,076,038
33,415,686
Capital and reserves
Called up share capital
17
1
1
Profit and loss reserves
40,076,037
33,415,685
Total equity
40,076,038
33,415,686
The financial statements were approved by the board of directors and authorised for issue on 30 September 2021 and are signed on its behalf by:
Mr R R Goldsmid
Director
Company Registration No. 05241591
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
- 8 -
1
Accounting policies
Company information
Elbit Systems UK Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
2 Temple Back East, Temple Quay, Bristol, BS1 6EG.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest
£.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares
publicly available consolidated financial statements
, including this company,
which are
intended to give a true and fair view of the assets, liabilities,
financial position and profit or loss
of the group
.
T
he company has
therefore
taken advantage of
e
xemptions from the following disclosure requirements:
-
Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares
;
-
Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash
f
low and related notes and disclosures
;
-
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income
;
-
Section 33 ‘Related Party Disclosures’ – Compensation for key management personnel
.
The financial statements of the company are consolidated in the financial statements of
Elbit Systems Limited
. These consolidated financial statements are available from
www.elbitsystems.com
.
The company has taken advantage of the exemption under section 40
1
of the
Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group
.
1.2
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
Development contract revenue and associated costs are recognised as revenue and expenses respectively by reference to the stage of completion of the contract activity at the balance sheet date and the anticipated profit at the end of the contract.
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
1
Accounting policies
(Continued)
- 9 -
1.4
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Land and buildings leasehold
10% straight line
Fixtures, fittings and equipment
10% - 20% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
The investments are assessed for impairment at each reporting date
and
any
impairment
losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company
. Control is
the power to govern the financial and operating policies of
the
entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities
.
1.6
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
1
Accounting policies
(Continued)
- 10 -
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Short term trade debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
Basic financial liabilities
Short term trade creditors are measured at transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts,
are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
s
ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as
being measured at
fair value th
r
ough profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
1
Accounting policies
(Continued)
- 11 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.10
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease
s
asset are consumed.
1.11
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 12 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant
effect on amounts recognised in the financial statements.
Valuation of investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
The investments are assessed for impairment at each reporting date
and
any
impairment
losses or reversals of impairment losses are recognised immediately in profit or
l
oss
.
Long-term contracts
The amount of profit attributable to the stage of completion of a long term contract is recognised when the outcome of the contract can be foreseen with reasonable certainty. Turnover for such contracts is stated at the cost appropriate to their stage of completion plus attributable profits, less amounts recognised in previous years. Provision is made for any losses as soon as they are foreseen.
Contract work in progress is stated at cost incurred, less those transferred to the profit and loss account, after deducting foreseeable losses and payments on account not matched with turnover.
3
Operating loss
2020
2019
Operating loss for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
12,500
7,350
Depreciation of owned tangible fixed assets
139,116
72,732
Operating lease charges
239,689
197,004
4
Employees
The average monthly number of persons (excluding directors) employed by the company during the year was:
2020
2019
Number
Number
Employees
33
24
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 13 -
5
Interest receivable and similar income
2020
2019
£
£
Interest income
Interest receivable from group companies
1,546,793
1,649,755
Other interest income
38
Total interest revenue
1,546,831
1,649,755
Other income from investments
Dividends received
5,810,000
8,526,750
Total income
7,356,831
10,176,505
6
Interest payable and similar expenses
2020
2019
£
£
Interest payable to group undertakings
44,250
58,303
7
Taxation
2020
2019
£
£
Current tax
UK corporation tax on profits for the current period
206,037
183,422
Adjustments in respect of prior periods
(19,235)
Total current tax
206,037
164,187
Deferred tax
Origination and reversal of timing differences
13,875
66,285
Total tax charge
219,912
230,472
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
7
Taxation
(Continued)
- 14 -
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2020
2019
£
£
Profit before taxation
6,880,264
9,801,039
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2019: 19.00%)
1,307,250
1,862,197
Permanent capital allowances in excess of depreciation
6,957
Under/(over) provided in prior years
(7,339)
Dividends received not taxable
(1,103,900)
(1,620,083)
Other timing differences
9,605
(4,303)
Taxation charge for the year
219,912
230,472
8
Dividends
2020
2019
£
£
Interim paid
11,500,000
9
Tangible fixed assets
Land and buildings leasehold
Fixtures, fittings and equipment
Total
£
£
£
Cost
At 1 January 2020
944,232
527,192
1,471,424
Additions
249,405
249,405
At 31 December 2020
944,232
776,597
1,720,829
Depreciation and impairment
At 1 January 2020
24,317
119,070
143,387
Depreciation charged in the year
85,666
53,450
139,116
At 31 December 2020
109,983
172,520
282,503
Carrying amount
At 31 December 2020
834,249
604,077
1,438,326
At 31 December 2019
919,915
408,122
1,328,037
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 15 -
10
Fixed asset investments
2020
2019
Notes
£
£
Investments in subsidiaries
11
17,381,412
17,381,412
Investments in joint ventures
12
150
150
17,381,562
17,381,562
Movements in fixed asset investments
Shares in subsidiaries and joint ventures
£
Cost or valuation
At 1 January 2020 & 31 December 2020
17,381,562
Carrying amount
At 31 December 2020
17,381,562
At 31 December 2019
17,381,562
11
Subsidiaries
Details of the company's subsidiaries at 31 December 2020 are as follows:
Name of undertaking and country of
Nature of business
Class of
% Held
incorporation or residency
shareholding
Direct
Ferranti Technologies
England and
Aerospace and defence
Ordinary
100.00
(Group) Limited
Wales
Elite KL Limited
England and
Defence contractor
Ordinary
100.00
Wales
UAV Tactical Systems
England and
Defence contractor
Ordinary
51.00
Limited
Wales
UAV Engines Limited
England and
Aerospace and defence
Ordinary
100.00
Wales
Instro Precision Limited
England and
Defence contractor
Ordinary
100.00
Wales
Endomedix BV Limited
Netherlands
Defence contractor
Ordinary
100.00
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 16 -
12
Joint ventures
Details of the company's joint ventures at 31 December 2020 are as follows:
Name of undertaking
Registered
Nature of business
Class of
% Held
office
shares held
Direct
Affinity Flying Training
See below
Defence contractor
Ordinary
50.00
Services Limited
Affinity Flying Services
See below
Defence contractor
Ordinary
50.00
Limited
Affinity Capital Works
See below
Defence contractor
Ordinary
50.00
Limited
The registered office of the above companies is Hill Park Court, Springfield Drive, Leatherhead, Surrey, KT22 7NL.
13
Stocks
2020
2019
£
£
Work in progress
248,330
246,538
14
Debtors
2020
2019
Amounts falling due within one year:
£
£
Trade debtors
1,271,904
376,145
Corporation tax recoverable
73,961
Amounts owed by group undertakings
16,809,333
4,242,933
Amounts owed by undertakings in which the company has a participating interest
2,434,089
1,884,578
Other debtors
2,846
20,592,133
6,503,656
2020
2019
Amounts falling due after more than one year:
£
£
Amounts owed by undertakings in which the company has a participating interest
8,936,195
11,426,822
Total debtors
29,528,328
17,930,478
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 17 -
15
Creditors: amounts falling due within one year
2020
2019
£
£
Trade creditors
287,795
144,797
Amounts owed to group undertakings
3,430,708
4,616,681
Corporation tax
454,033
Other taxation and social security
768,686
315,600
Accruals and deferred income
5,414,186
1,274,993
9,901,375
6,806,104
16
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2020
2019
Balances:
£
£
Accelerated capital allowances
84,000
70,125
2020
Movements in the year:
£
Liability at 1 January 2020
70,125
Charge to profit or loss
13,875
Liability at 31 December 2020
84,000
17
Share capital
2020
2019
2020
2019
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 0.1p each
1,491
1,491
1
1
ELBIT SYSTEMS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 18 -
18
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2020
2019
£
£
Within one year
508,014
217,750
Between two and five years
1,210,212
1,424,745
In over five years
932,704
1,226,184
2,650,930
2,868,679
19
Related party transactions
The company has taken advantage of the exemption conferred within FRS102 section 33.1A not to disclose transactions between wholly owned members of the same group.
The company owns 50% of the share capital of Affinity Flying Training Services Limited ("AFTSL") and Affinity Capital Works Limited ("ACWL"). The company also owns 51% of UAV Tactical Systems Limited ("UTACS").
During the year, the company charged interest of £1,445,835 (2019 - £1,604,315) to AFTSL in relation to loans advanced. The company received dividends of £700,000 (2019 - £1,200,000) from AFTSL. At 31 December 2020, included within debtors is an amount of £11,370,284 (2019 - £13,311,400) due from AFTSL.
During the year, the company received dividends of £2,050,000 (2019 - £3,501,750) from ACWL.
During the year, the company received dividends of £3,060,000 (2019 - £3,825,000) from UTACS. At 31 December 2020, included within creditors is an amount of £195,188 (2019 - £Nil) due to UTACS.
20
Ultimate controlling party
The company is a subsidiary undertaking of Elbit Systems Limited, a company incorporated in Israel, which is the ultimate parent undertaking and controlling party.
Elbit Systems Limited is the largest and smallest group for which group financial statements are prepared. The group financial statements of this group are available to the public and may be obtained from www.elbitsystems.com.
2020-12-31
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